Germany Sept industrial orders fall 4.3% on weak eurozone demand

04 November 2011 14:10  [Source: ICIS news]

LONDON (ICIS)--Germany’s industrial orders fell 4.3% in September from August, led by a 12.1% decline in orders from customers in the eurozone, the country’s economics ministry said on Friday.

September’s decline came after a revised 1.4% fall in August from July.

On a two-month sequential comparison – August/September vis-a-vis June/July – industrial orders were down 4.6%. However, year-on-year, orders were still up 3.2% from August/September 2010.

The ministry said that orders continued to weaken in past months after strong order volumes in the earlier part of the year. 

“Companies seem to be holding back on placing new orders, especially for large-ticket items,” the ministry said.

The order data indicated that fourth-quarter industrial production in Europe’s largest economy will likely take a “calm course,” it added.

Meanwhile, Germany’s central bank, the Bundesbank, said on Friday that its index for September order volumes in Germany’s chemicals and pharmaceuticals industry fell to 98.4 points, from 102.1 points in August.

Germany’s chemical production fell 2.0% in the third quarter from the second, chemical trade group VCI said earlier this week. However, the group retained its previous forecast of a 5% year-on-year increase in the country’s full-year 2011 chemical production.

In related news, research group Markit reported this week that its purchasing managers' index (PMI) for Germany fell for the sixths month running in October - to 49.1 points from 50.3 in September - hitting its the lowest level since July 2009. A reading of below 50 indicates a contraction.

Manufacturers surveyed by Markit often cited the uncertain economic outlook as causing clients to delay spending decisions and reduce their inventories, the firm said.

“A sustained shrinking of new orders and tendency towards destocking adds to the likelihood of a greater loss of momentum during the months ahead, unless the financial and economic backdrop starts to become more supportive to market confidence,” Tim Moore, senior economist at Markit, said in commenting on the near-term outlook for Germany's manufacturing sector.

Markit’s PMI is based on a survey panel of more than 500 German manufacturing companies.

Read Paul Hodges’ Chemicals and the Economy Blog

By: Stefan Baumgarten
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